Indonesia has received a boost from two major foreign direct investment (FDI) deals in recent weeks, one by China based chemical products manufacturer Sichuan Hebang Biotechnology and the other from US food and beverage multinational PepsiCo.

In a press statement released by Sichuan Hebang, the company said it plans to invest $800m (5.83bn yuan) in the construction of a chemical production base in the JIIPE Industrial Park in Surabaya, a port city on East Java island and the third-largest urban area in Indonesia, following Jakarta and Bekasi.

Sichuan Hebang CEO Zeng Xiaoping signed a letter of investment intent with Haryanto Adikoesoemo, president of AKR Group, a company that deals with the logistics and distribution of chemicals. In addition, Xiaoping signed a conditional land sale agreement with Bambang Soetiono, president of BKMS, a subsidiary of AKS.

The planned plant area is 67 hectares, and it will reach a production capacity of 600,000 tonnes each for sodium carbonate and ammonium chloride.

In a separate move, US-based PepsiCo said it will invest $200m (Rp3.05trn) to open a new snack factory in Cikarang, West Java.

The company said its new facility will be “prioritising local talent, harnessing local raw materials and strengthening the domestic value chain”, adding: “With its rapidly expanding economy, dynamic demographic profile and evolving consumer needs, Indonesia presents unparalleled opportunities, particularly in the food and beverages sector.”

The factory will become operational in 2025.

News of these projects follows a significant increase in greenfield FDI projects in Indonesia in 2022. According to GlobalData, international companies announced 188 new projects in Indonesia in 2022, a 66.4% increase from 2021. In comparison, the Asia-Pacific region attracted 4,863 FDI projects from 2,989 foreign parent companies in 2022.

The government in Jakarta has recently welcomed several big names including SpaceX, which in June 2023 launched a $540m satellite project aimed at improving high-speed internet connectivity in Indonesia’s most remote areas.

Overall, gross domestic product in Indonesia is expected to grow in the next five years, from $1.18trn in 2021 to $1.82trn in 2026.